Choosing Between Two Disruptions

A couple of weeks ago I was talking shop with a colleague of mine – the co-founder and CTO of a fascinating software company. He was bemoaning the paralysis that was affecting his company. Every executive was playing it safe, too safe. It was next to impossible to finalize their CY2009 plan as no executive would give hard commitments, let alone be aggressive about making commitments. My colleague was worried. Big time.

The fascinating thing about our conversation was that my anguished colleague was quite bullish about Agile methods. His was an informed bullishness – he is a very astute developer who grasps the potential of Agile in a deep manner. While worried about the financial crisis working its way from Wall Street to Main Street, my colleague was quite willing to invest in Agile methods in more than one way. It was intuitively clear to him Agile is not only a good risk to take, it is the right kind of risk to take these days.

The Risks of Introducing Agile

The risk you take rolling Agile on a large scale is the possible process disruption you introduce in your company. There are several risks; at the top of the list:

R&D productivity could go down before it goes up.

Marketing might be hesitant to promote features that are not 100% guaranteed to be in the forthcoming release.

Sales will need time to elevate the playing fields from selling function/feature to selling value.

Customer Support must revise support policy to accommodate frequent releases.

I would not take any of these risks lightly. Any one of them could get you and your company in serious trouble.

I would, however, suggest you look carefully into the nature of the Agile disruption. Like a set of nested Russian dolls, the disruption to your company’s established modus operandi masks the disruption Agile creates in the market. When it comes to Agile, you face the Innovator’s Dilemma in the Christensen sense.

The Risks of Avoiding Agile

As software becomes more and more pervasive, it does not really matter whether you are in Information Technology, Financial Services, Transportation, Retail or any other vertical. The strategic question you need to consider is your company’s competitive position in the market vis-a-vis rivals who will successfully adopt Agile:

How would you cope with a competitor who is much faster to market than you?

How would your cost structure be viewed by industry analysts when your rivals rip the benefits of hyper-productive Scrum teams?

Would your brand be negatively affected if you fell behind on quality?

How would your strategic customers assess your response time to requests for enhancement compared to nimbler players in the field?

While Agile may cause what seems like negative disruption internally, the need for so doing is often dictated by a corresponding disruption in your markets, where you can’t choose to avoid the disruption. You need to do a risk assessment of the internal disruption Agile might cause versus how you will be affected by market disruption if you do nothing, or something other than Agile.